Assuming everyone picked randomly, the lottery payout still would be EV+ at a certain point, even with potential splitting. Calculating the number of players is not easy but in the past I've tracked how fast the jackpot has grown and assuming half the ticket sales goes into the jackpot, everything is basically EV+ by 500-600 million.

You can be petty too and calculate the hundreds of millions you'd owe in taxes. Again, this raises the breakeven point but does not dispel it (I think it's in the 700-800 million range). I assume that none of us factor in our marginal tax rates when we decide to call or fold a pot in poker, so I definitely think the tax thing is being petty.

If $800k does not really have more utility to you than $400k though, it's still effectively - EV.

So your utility neutral point is below 400 million or above 800 million?

Way below.

I guess technically I have no real neutral point, but I would have extremely significant diminished returns beyond the typical low lottery jackpots of $20 million or so, enough that the lottery would likely never be +EV for me.

I only start buying tickets when the net is 1 to 1 odds for mah dollar

Man after a long dry stretch the last few sessions have been some nice run good. And the games seem really good leading into the holidays, which is pretty typical. Favorite hand from yesterday:

I’m racked up to leave with a couple hands before I go and a small $200ish profit locked up (Yey).
I raise KhJh in late position, literally everyone calls and a terrible aggro player 3! The BB. So 6 to the flop which is J83hh. BB bets, I raise and it comes back to me capped (5 bets) four ways. Turn is 9h, I raise again and both LP players hem and haw before calling. River is a beautiful 2d, I bet, LP calls and pity shows QsTc, BB calls and doesn’t show.
Fun to basically make your whole session in one hand two minutes before you leave.

I don't think you've really thought your position through.

Some level of money has to have some positive level of utility for you. You actively try to obtain money, so dU/dEV is positive, at least at your current value.

If you're saying that your utility function flattens out lower than most people, then you should be playing the lottery more than other people, because even the minor prizes would bring you as much utility as the jackpots bring others. Having a relatively flat utility function is great, it allows you to take chances others wouldn't. Instead, you use it as a defense mechanism not to take chances.

I don't understand why you need to pretend that the lottery is stupid or illogical (like most things it is neither as good as proponents say nor as bad as critics say). Just say you don't want to play it, that's fine.

I don't play the lottery, not even for record setting prizes. I only participated in office pools when asked more than once about it.

But I see why they're popular, and I think a lot of people quasi-rationally play it. It's an escape and a potential to access something essentially unobtainable by other means.

10,000 is significant to me at this point because it means I get to take more vacations during school

Seriously? $20 million? You can't even buy a nice jet for $20 million.

I could easily spend $100 million in the first week. It might take me a few months to go through the whole $700 million though.

I have no desire to own a jet.

Callipygian, I don't really get what you're trying to say. Personally, the money I have already has a great deal of utility to me, but additional amounts don't have that much. And I don't really go much out of my way to get additional money. I don't like spending money; I think the amount I would lose by playing the lottery would cause me more loss than most people.

I guess for people who like to play, it buys them a dream of what their life would be like if they won. But just a bit of research turns up stories of how people win and then have miserable lives.

Callipygian's philosophy includes "Greedily hoover up every dollar you can" so you might want to take that aspect into your consideration of how he views money.

I can understand having no interest/desire in playing the lottery. The same is true of trying to pursue promotions or trying to seek out another type of edge in some other financial situation. I don't believe that pursuing more money is always the better choice.

But I do find it oddly and excessively pessimistic to try to argue that in every case you would say that it's -EV to play. It feels much like you've determined your conclusion in advance (no desire to play) and have back tracked your way to some sort of argument to justify it (it's always -EV on some utility scale).

The linked post is an excellent summary of my feelings on money.

People are irrationally squeamish about admitting they want money. There's a rational level where you could say obsession is bad; certainly people who acquire money as an end rather than a means to an end will end up disappointed. There's also a realistic level of recognizing all that money all at once is bad. But as Aaron points out (probably because it takes one to know one), you're bending over backward to justify some weird prejudice.

Whenever the lottery is EV+, why don't you play it (much the same way that yoy "spend" money in poker, risking a loss in an EV+ situation), collect it anonymously (Google it), and then anonymously buy up your favorite poker room so you can control the rake forever? That way your lifestyle doesn't have to change and you can keep doing all the things you're currently doing.

I read something a while ago from a guy that ran some numbers and came to the conclusion that the EV only increases to a certain point, but then eventually decreases due to the increased chance of splitting the jackpot. And it was never +EV.

I still play it and I could easily spend hundreds of millions of dollars.

4 bet pre

gamboooool!!!

I know it takes more time to write out obvious details, but you 4-bet pre and the BB capped, right?

I'll try to find lottery.xls and post my numbers and assumptions.

Still not sure what you're trying to convince me of, but even if the the lottery is +EV in pure dollars, it's still -EV in utility to me. I assume it is to you as well, or you would be playing it regularly. And you don't even have to travel to another state to play!

A few notes:

1) Given that you've separated out EV in utility and EV in pure dollars, if one makes a pure dollar calculation, the lottery is usually -EV, and I'm not sure what exactly you're trying to conclude.

2) This is a Sklanskian sort of position to take, trying to boil everything down to some sort of EV estimation or gambling-type proposition. It may be useful in some circumstances to think this way, but doesn't work out very well in reality because it's not how humans actually behave.

3) Because of 2, I think you should re-examine your position and try to come up with a description of your position that sounds less contrived. Would you wager a penny if there was a 1% chance of winning $100,000? A 10% chance?

1) Yes, usually the lottery is -EV dollarwise for anyone. But I'm saying that even when it is very high and people say it is a "good bet", it isn't so for me.

2) I'm pretty close to "**** Economicus", or at least I try to be. You are correct that most humans don't behave that way though.

3) Still don't get what you think is contrived; this is the way I actively think about my decisions. I would take either of those gambles you mentioned, because they are hugely +EV, because the prize is not above my line of greatly diminishing returns, and because a penny is not much for me to risk.

I think this was it:

http://www.circlemud.org/jelson/megamillions/

mega millions has changed since then (harder to hit the jackpot) so maybe things could be different, but I would guess not.

+1

Thanks as always Aaron W., could not agree more on all 3 points you indicate.

A very street smart friend from NY indicated lottery is essentially life tax and I never/rarely play the lottery partly for that reason although I do get forced into chipping in like $2 when my wife asked me to chip in once when her and her friend wanted to play it.

Not a fan of burning money even a $1 but to each their own for the ones that play lottery.

https://www.youtube.com/watch?v=sENssnI9CGc

Thanks for the discussion guys. The only bit that I really disagree with is Aaron's thought comparing the importance of food and gambling. I've been lucky that I've never gone more than 35 hours or so without eating. It was one of the more miserable feelings that I've ever had.

Nice to hear lots of points of view.

The appearance of being contrived comes from the arbitrariness of the declaration. It still sounds like you're backwards justifying your position. I'm not saying that you aren't actively thinking about your decisions. It just seems like a post-hoc justification, like you felt that the lottery was a waste, and then you've created some undefined utility function in order to justify how you feel about playing the lottery.

Would you take the bet scaled up to a dime ($0.10 to win $1,000,000?) Or a dollar ($1 to win $10,000,000)? Or two dollars ($2 to win $20,000,000)?

So you'd rather not win the lottery?

Because that's what utility-negative means. I doubt you mean that. What you mean is that the utility+ of potentially winning the lottery is less than the utility+ of the price of the ticket.

And that's fine. It's a complicated way of saying you don't want to play the lottery. And that's where I am too, to be clear.

No, because much like money, utility has degrees. Potentially winning a EV+ lottery is utility+. Having an extra dollar is utility+. It appears the latter is larger for you. That's fine - you don't need to bend over backwards to make "lottery is utility negative" arguments.

As a matter of fact, lots of people find even EV- lotteries U+. Not me and not you, but there's nothing stupid about what they do. The most U+ thing for me, investing in Callipygian Pharmaceuticals, is admittedly probably EV-.

EV and utility are somewhat independent. If you watch a movie, it's EV-/U+, and U(movie) > U(cost of movie). I could work on erectile dysfunction pills, and it'd probably be EV+, but U-. I'd take a lower EV+ to have a U+.

People love to smugly point out that the lottery is a stupid tax. But I think people who do that ignore the good things about the lottery, as well as many things that are lottery-like.

Lol no I didn’t I am sure I screwed up the description somewhere. I put in the first raise PF and it came back to me capped.

Sheesh now enough attempts at content itt! I am finally running good and won a two rack pot as I was racking up! That was the point!

Oh I did find out that CP is increasing the already too high rake by $1 at the start of the year. Apparently it is going to go to the jackpot. So gross - we are lobbying for no more JP at 20/40